Patients with chronic type B hepatitis are being studied. Approximately 150 patients are followed regularly in the outpatient clinic; serologic markers of hepatitis B virus (HBV) are determined frequently in serum. Selected individuals are entered into controlled therapeutic trials of either anti-viral or immunosuppressive drug therapy. In a randomized, controlled study of adenine arabinoside 5' monophosphate (Ara-AMP), a one-month course of drug did not lead to a significantly higher rate of clinical improvement (30%) than occurred in a control group receiving no therapy (20%). Further studies of a single, high-dose course of prednisolone, multiple courses of Ara-AMP and every other day therapy with recombinant DNA human leukocyte A interferon are currently in progress. The pathogenesis of chronic type B hepatitis is being investigated using in vitro assays of immunologic function. A specific defect in anti-HBs synthesis by chronic HBsAg carriers has been identified. The etiology of this defect is being pursued and appears to be a consequence of the large amounts of HBsAg in the circulation of most carriers inhibiting the proliferation of clones of anti-HBs synthesizing lymphocytes.